Use the Following Information for Questions

Multiple Choice

Use the following information for questions
Suppose you are a bank lending officer and you are trying to determine if it is worthwhile giving a loan to a potential borrower.You have a prior belief that a borrower is good or bad with equal probability.By gathering information you can determine, albeit imperfectly, whether an applicant is good or bad.If the applicant is good, there is a probability of 0.7 0.3 that your signal reveals that he is good bad.If the applicant is bad, there is a 0.4 0.6 probability that your signal reveals that he is good bad.
-What is your posterior belief that an applicant is good when your signal tell you that he is good?

A) 0.36
B) 0.55
C) 0.64
D) 0.70
E) Insufficient information